|
Nelcast hosted a
conference call on Jan 30, 2024. In the conference call, company was
represented by, Mr. P. Deepak -Chief Executive Officer & Managing Director
and Mr. S.K. Sivakumar- Chief Financial Officer.
Key takeaways
of the call
In
Q3 FY24, company’s sales volume decreased 4.2% YoY to 20,608 Tonnes. Company’s revenue
growth was dragged due to subdued performance of the M&HCV and tractors
segments.
Company
clocked exports of Rs 339 crore in 9M FY2024, up by 38% YoY. Company expect to
sustain quarterly run rate of Rs 100 crore in Q4 FY24.
In
FY25, management expects exports to sustain its growth momentum on the back of
existing order book and additional contribution from new product launches.
With increase in
infrastructure spends by the Government and pick-up in construction activity,
company expects strong growth in M&HCV segment in FY25. Tractors should
report modest growth.
Going
forward, key growth drivers will be exports and recovery in domestic market. Management
expects double-digit revenue growth in FY25.
EBITDA/kg
stood at Rs 13 in 9MFY24 and Rs 12.1 in Q3 FY24, an increase of 9.4% and 20.7%
YoY respectively.
Going
forward, management expect EBITDA/kg to expand around Rs 13-14 driven by the
sustained strong performance in exports alongside increase in capacity
utilization leading to improved operational efficiency.
In
Q3 FY24, company’s margin improved driven by Stabilization of raw material
prices and increased export sales.
In
9MFY24, the largest share was contributed by M&HCV making up 38% of the
total revenues, followed by Tractors 21%, Exports 35%, Railways 3%, Off-highway
equipment 2%, and Others 1%.
Company
intends to continue its focus on launch of new products. Company further aims
to forge new relationships and expand diversity in its geographies and sector
splits.
Company
expects some increase in its working capital requirement in FY25.
Exceptional
items of Rs 17.28 crore was on account of profit on sale of land during quarter
ended 31 December 2023.
In
Q4 FY24, capacity utilization was 58%. Company expects utilization to improve
to 80% in coming years.
Company
is planning a capex of about Rs 30 crore per year for FY25 and FY26.
|